11 May, 2017

The 2017 Federal Budget cut funding to TAFE and vocational education

By the StopTAFE Cuts Team

The 2017 Federal Budget delivered nothing for TAFE or TAFE students, and is a continuation of the Turnbull Government’s attack on the sector, and its failure to provide policy leadership or support. Spending on vocational education will be cut by close to 10% in the next financial year, with ongoing cuts across the budget forward estimates.

The National Partnership Agreement for Skills Reform has been cut, and replaced with the National Partnership Skilling Australia Fund. This represents a cut of $177 million to the states and territories in 2017/18, and annually cuts thereafter. The government claims that the Fund will deliver 300,000 new apprentices and trainees, but gives no information about how this will occur. The Fund can be used for a range of things, including employer incentives and support for improvements in retention and completion. This means that it does not have to be spent on education and training.

The Skilling Australia Fund will be funded in part by the levy imposed by the government on employers using temporary and permanent migration programs. It requires matched contributions from the states and territories and the amounts available to them will depend on how much they contribute to the fund and will also be contingent on them meeting certain criteria – yet to be made public by the government.

There is no detail about how this fund will be managed, and no guarantee about the future funding allocated in it.

There is also no guarantee that the funding will actually be used for training.

There is no guarantee in the package that funding will be used to support TAFE or TAFE students. In real terms, on a state by state basis, the package will cut funding over the next financial year across the country.

$million

NSW

VIC

QLD

WA

SA

TAS

ACT

NT

Total

Cut 2017-18

-$54m

(-32%)

-$40m

(-31%)

-$43

(-38%)

-$16m

(-30%)

-$13m

(-35%)

-$6m

(-46%)

-$3m

(-31%)

-$3m

(-45%)

-$177m

(-34%)

This comes on top of a decline in funding over the last 10 years of close to 15%.

Other announcements in the budget which will impact significantly on TAFE and vocational education include the uncapping of sub-bachelor qualifications at university which will encourage the expansion of such courses in universities, encouraging them to absorb upper level vocational education courses. It will be cheaper for students to enrol in universities to undertake sub degree programs than it would be for them to do them at TAFE. Already, many private providers are charging students upfront “gap” fees where the amount that a student can borrow through the new VET Student Loan scheme is insufficient to cover the amount that the provider is charging. This is in part because the government is refusing to cap the amount that a provider can charge a student for their course in vocational education. It is another example of the differential and discriminatory way in which vocational education students are treated in comparison with their higher education cousins.

Government funded sub degree programs in vocational education comprise more than 20 per cent of delivery in TAFE. A significant proportion of TAFE delivery is put at risk under these new arrangements.

The lowering of the repayment threshold for all student loans from $55,000 to $42,000 will disproportionately affect TAFE and VET students, who are over-represented in low SES and disadvantaged cohorts. Many of these students are carrying a debt from courses which were either not delivered, or which were not completed – and many of these qualifications will be completely worthless to students.

The effect of the 2017 Federal Budget will be to continue to undermine the role of TAFE and punish those students who have been ripped off, through the VET FEE HELP, by private for-profit providers.

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